Avoid CGT on BTL gift to child

[jjjjjjjjjj]

My father would like to sell his BTL property to my brother and I for £400k (the amount remaining on the mortgage). Property is worth £1.8m.
He bought the house for about £400k so my understanding is there is ~1m subject to CGT.
Is he able to sell or gift the property to us in stages to take advantage of his annual CGT allowance?
Is a trust the right direction? Could we do that in phases?

[AdamS93]

Professional advice is the way to go.

The gain is the market value less the amount paid, meaning £1.4m based on you numbers. Also, as there is a mortgage stanly duty land tax will be payable. If your father passes away within 7 years of gift, IHT will still be due.

Transferring on a piecemeal basis will take a very long time with a property of that value.

Property isn’t a tax efficient investment and you should always expect to pay a fair amount of tax as a result.

[jjjjjjjjjj]

Thanks for replying. Would anyone else be able to offer some advice?

[maths]

The property value of £1.8m presents a problem.

The potential capital gain on a sale/gift is circa £1.4m giving a CGT charge at 28% of £390,000 (CGT being based on market value not the 400k consideration).

If the property was left by will then this capital gain is simply wiped out with no CGT charge.

Often gifts are given from X to Y via a discretionary trust with CGT hold-over deferring any CGT charge. Unfortunately, in this case a significant IHT charge arises.

Selling bits to use up the annual CGT exemption not a practical option.